The 500,000 Britons who own property in Spain can continue to celebrate this New Year thanks to changes in Capital Gains Tax (CGT) legislation for non-residents.

In October, the Spanish Senate approved Legislation to reduce the CGT which is Payable on the difference between the original purchase price and the selling price for non-residents.

As of January, 2007, Spanish CGT for non-residents has been reduced by almost half, down from 35% to just 18%. The new legislation means that Britons planning on selling their Spanish property can achieve greater profits, making more capital available to be reinvested elsewhere.

They also approved a reduction in the withholding provision that non-residents pay when selling property in Spain from 5% to 3%. The withholding provision is paid to the Spanish tax authorities upon completion and covers any debts the seller may have accrued which could be difficult to recover once they have left the country.